Mondi cancels Syktyvkar sale to Augment

The planned sale of Mondi's Syktyvkar facility in Russia to Augment, as announced in August 2022, will not take place.

Mondi is withdrawing from the agreement to sell Mondi’s most significant facility in Russia, joint stock company Mondi Syktyvkar, together with two affiliated entities, to Augment. This follows recent discussions with Augment on its lack of progress in gaining the necessary approvals to complete this transaction, according to Mondi. As per the terms of the sale and purchase agreement, the disposal to Augment will therefore be terminated and will not complete.

However, Mondi's board underlines that it remains committed to divest Syktyvkar and will continue to assess all alternative divestment options, the company underlines.

Augment is an investment vehicle majority owned by Viktor Kharitonin, comprising assets in the pharmaceutical and other sectors across Russia, Europe and the United Kingdom. In August 2022 Mondi announced plans to sell Syktyvkar to Augment for a consideration of RUB95bn (around €1.5bn).

Syktyvkar employs approximately 4,500 people and it is a leading provider of uncoated fine paper and containerboard to the domestic Russian market. For the six months ended 30 June 2022, Syktyvkar reported an Ebitda of €225m. Gross assets of the business were €1.60bn while its net asset value was €1.2bn as of 30 June 2022.

According to information given earlier, the Syktyvkar mill can produce 1.2 million t of market pulp and paper, including 300,000 t of kraftliner, 200,000 t of woodfree uncoated paper and 180,000 t of newsprint.

The proposed disposal of the Group’s three Russian packaging converting operations to Gotek Group, as announced on 15 December 2022, is not connected with the proposed disposal of Syktyvkar. This transaction remains in progress.

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